Lawmakers Form Bipartisan Caucus to Protect PSLF

A bipartisan team of lawmakers earlier this month announced the formation of a Public Service Loan Forgiveness (PSLF) Caucus in the House of Representatives to focus on protecting the program that would provide student loan forgiveness to borrowers who go on to work in public service occupations.

Reps. Ryan Costello (R-PA) and Brendan Boyle (D-PA) formed the caucus with support from a coalition of more than 50 organizations, led by the National Education Association. Under PSLF, a federal program created under former President George W. Bush in 2007, borrowers with federal student loans may have their debt forgiven after working in qualifying public service positions for 10 years and making 120 on-time payments in qualifying repayment plans.

"Many teachers, first responders, and public health specialists are working hard to make a difference in their local communities when relying on the [PSLF] Program," Costello said in a statement. "We must fulfill the promise made to these student borrowers over the past decade."

The group's development comes at a time when many are questioning the future of the federal program. Conservative-leaning thought leaders in higher education have in the past proposed curtailing or ending the program, claiming it would cost taxpayers billions of dollars and saying it would benefit graduate student borrowers with larger amounts of debt who go on to earn relatively high incomes when compared to those in other areas of public service. Even former President Barack Obama proposed capping the amount of debt that can be forgiven under the program. NASFAA's PSLF Task Force also suggested putting limits on forgiveness amounts, among other recommendations.

And most recently, President Donald Trump suggested in his fiscal year 2018 budget proposal eliminating the program entirely, although the administration has said this would only apply to new borrowers, with current borrowers working toward forgiveness grandfathered into the program.

Recent actions from the Department of Education (ED) have also cast doubt on borrowers' prospects of loan forgiveness. Four individual lawyers joined by the American Bar Association in December sued ED after the agency retroactively told the borrowers their employers did not meet PSLF requirements. The lawyers had submitted Employment Certification Forms that were previously approved by FedLoan Servicing, the company that handles PSLF loans, signaling they were on track to receive loan forgiveness. And recent court filings from ED have given the impression that borrowers cannot rely on FedLoan Servicing to guarantee whether they qualify.

"We must do more to help folks drowning in student loan debt, and to prevent the burdens of student loan debt from making one's desire to serve his or her community unattainable," Boyle said in a statement. "The PSLF Caucus will focus on making good on our collective promise to public servants who have served their communities for years, often for low pay in positions that may have otherwise not been financially manageable, with the understanding that the 10-year-old [PSLF] program would eventually help them lighten their burden of student debt. Current threats to end or limit the program are shortsighted, to say the least. PSLF is an incentive to our students, and an investment in our future."

Publication Date: 8/17/2017

Ken G |
8/18/2017 2:47:40 PM

Despite comments above, positions at religious organizations are not excluded -- its only proselytizers that are. There is no perverse incentive behind PSLF -- there are a finite number of jobs to be filled (and still go unfilled...), and .there is no "sit and wait" for forgiveness to happen. You repay about 90% of what you borrowed while working in often-difficult jobs/surroundings for longer than the period of military conscription to pay for a graduate degree, longer than the period of disincentive to dissuade people to file for bankruptcy. I'm not sure there is a longer base obligation under another government program. And while I get the idea of capping benefits, some graduate jobs (ones even listed in the statute and earliest versions of the legislation over more than one Congress) require a graduate degree for licensure.Capping the benefit is good if the goal is cutting people a break for doing something nice. But the purpose of the program is to fill chronically vacant jobs in rural and other hard to reach areas, serving in jobs serving the public -- of which there are fewer than when the program was enacted. What's the cost to those communities to end the program or deny support to highly skilled professionals? What's the cost to the economic grid? PSLF is investment. Capping the program is like saying we can save money by making bridges shorter.and with lighter materials.

Daniel R |
8/17/2017 7:33:34 PM

I'm concerned about the existing restrictions based on religion which is ultimately unconstitutional and allows discrimination for PSLF eligibility based on religious belief. Treat all non-profits fairly. Protect religious freedom.

Jason G |
8/17/2017 10:41:36 AM

As a graduate/professional FA director I worry about this program all the time. Loan forgiveness creates perverse incentives for both students and institutions, especially at the graduate level. Students on the program are encouraged to make less, pay less and wait for forgiveness.

And so, being in repayment for ten years means very little when connected to income contingent repayment. And the program is eligible for both GradPLUS and Stafford programs meaning there are students regularly leaving programs in the quarter million dollar range.

Further, the program allows a whole hodge-podge of allowable sectors to be eligible - and some that don't need incentivizing.

Upfront grant aid should be the preferable method for federal aid.

James C |
8/17/2017 9:10:22 AM

It should stay but be capped to $57,500 as Obama proposed.

David S |
8/17/2017 8:31:06 AM

These loans have interest rates that are not particularly low, fees deducted at the time of disbursement, in many cases interest accumulating while the student is enrolled, and before a dollar can be forgiven, the borrower must be in repayment for 10 years. Nobody, I don't care what accounting sleight of hand you want to use, is going to convince me that PSLF "costs" the federal government anything. It merely reduces the massive profits a bit. This program was created for a reason, let's see if it works, tweak if necessary, and stop bleeding every borrower for every possible dollar.

Comments Disclaimer: NASFAA welcomes and encourages readers to comment and engage in respectful conversation about the content posted here. We value thoughtful, polite, and concise comments that reflect a variety of views. Comments are not moderated by NASFAA but are reviewed periodically by staff. Users should not expect real-time responses from NASFAA. To learn more, please view NASFAA’s complete Comments Policy.